"We are not in discussions to buy an equity stake in Proton. This is totally
false," Wong told Reuters.

The report had quoted him as saying the talks were ongoing and preliminary,
but the Singapore-based spokesman said those talks referred to a possible
engineering collaboration between GM-Daewoo and Proton for a next-generation
Proton vehicle.

GM-Daewoo, South Korea's third-largest automaker, is owned by GM.

Proton was not immediately available for comment.

GM entered the Malaysian market last year, mainly selling Chevrolet cars
through a distribution agreement with Hicomobil Sdn Bhd. It sold less than
1,000 units in the last quarter of 2003, and around 1,100 in the first three
months of this year.

Proton is owned around 35 percent by Malaysian state investment arm Khazanah
Nasional Bhd, and analysts say it is ripe for a buy-out by a global
automaker looking for a ready-made foothold in the growing Southeast Asian
market.

Former Malaysian Prime Minister Mahathir Mohamad told Reuters on Wednesday
he had been appointed an adviser to Proton, which he launched in 1983, and
added he would tell the auto maker to find a suitable foreign partner

With rivals such as Japan's Toyota Motor Corp. and Honda Motor Co. flexing
their muscles, Proton has seen its market share in Malaysia, Southeast
Asia's second-largest car market, drop to around half from some two-thirds
previously.